Big Tobacco

It's Been a Dream Week for Tobacco, the Life-Saving Plant

OK, a slight exaggeration. But there’s no denying that over the past week tobacco has enjoyed the kind of public relations that publicity agents dare not dream of. The biggest news is that the leaves of tobacco plants are being used to manufacture a serum against the deadly Ebola virus. Yes, the killer is now the savior.

That’s not all. Today the New York Timesreported that proposed new Food and Drug Administration guidelines require regulators of tobacco to take into account the lost happiness of smokers if they quit. According to the newspaper, the proposed rule “assumes that the benefits from reducing smoking—fewer early deaths and diseases of the lungs and heart—have to be discounted by 70 percent to offset the loss in pleasure that smokers suffer when they give up their habit.” How dare the government deprive smokers of their simple pleasure.

To round it off—because in journalism, all trends must come in threes—this week, Susan Cameron, Reynolds American’s (RAI) chief executive, told CNBC that she’s confident that antitrust regulators will approve her company’s $25 billion acquisition of competitor Lorillard (LO), bolstering the company’s market share and creating value for investors. So that’s good news for the widows and orphans who live off some of the $1.4 billion in dividends that Reynolds pays to shareholders every three months.

There remains the complication that smoking is the leading preventable cause of death in the U.S., killing 480,000 people a year, according to the surgeon general’s office. Reynolds is fighting a $23.6 billion jury judgment in a case brought by the family of a deceased smoker (coincidentally, close to what it wants to pay for Lorillard).